Self-Screening in Targeted Public Transfer Programs

Donald Parsons

Journal of Political Economy, 1991, vol. 99, issue 4, 859-76

Abstract: The self-screening properties of initial eligibility determination, a mechanism often under the control of the administrators of targeted transfer programs, are derived and the use of this mechanism in the social security disability insurance system is explored empirically. An increase in the rigor of initial eligibility screening may discourage potential applicants because they are unaware of appeal prospects and because the eligibility decision delay is lengthened, as denied applicants are forced to appeal their claims. In the disability program, a 10 percent increase in the initial denial rate induces a 4 percent decrease in applications. Self-selection is nonperverse. Copyright 1991 by University of Chicago Press.

Date: 1991
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